Extremismpresentation

Religious Extremism, Institutions, and Income: Theory and Evidence

ESHIA June,2007

Michael MakowskyH.B. Earhart FellowCenter for the Economic Study of ReligionDepartment of EconomicsGeorge Mason University

Extremism, Religious or Otherwise For better or worse, religious extremism is

associated with violence Are there social and economic conditions under

which extremist groups thrive or fail? Can we model this emergence of viable extremist

groups within a population? Can we gain insight into peculiar characteristics of

violent extremist groups “Approximately 90 percent of [Hamas’s] work is in social,

welfare, cultural and educational activities. These are important elements of Hamas's popularity that keep it closely tied to the public.” - Reuven Paz(2001)

Extremist Groups and Violence Extreme = High Sacrifice Extreme Sacrifice Groups are not violent by

nature (the heavy majority are entirely peaceful)

But…extremist groups possess the characteristic group loyalty and commitment necessary for the recruitment and training of martyrs (Iannaccone IJRR 2005)

Why Can Groups Demand Sacrifice? Prisoner’s Dilemmas, Free-Riders, Principal-

Agent problems – lots of reason’s why large groups should fail (Olson 1965)

Religious/Ideological groups manage to survive without contracts, high-cost monitoring, or wage incentives

Solution: Sacrifice and Stigma (Iannaccone JPE 1992)

Sacrifice And Stigma Model

Individuals use time and money to produce Private/Secular (S) and Group/Religious (K) goods

Religious groups prevent free-riding by Sacrifice & Stigma (S&S)

Effectiveness of S&S depends on relative prices (via income) and the substitutability of S for K

1

( )i S i K iU b S b K

Quick Version

( )

High Beta= Happy with one or the otherLow Beta= Need a

combination of both

The Functions (key on social interactions)

1

( )i S i K iU b S b K 1( )K R Q

1(1 ))

1j iQ R s

n

(1 )1( ) ( )(1 ) (1 )

a aS S

S S S

aw awp w

A a p a p

(1 )1( ) ( )(1 ) (1 )

b bR R

R R R

bw bwp w

A b p a p

An Agent-Based Model of a Religious Economy (Built with the lovely MASON java library) Sacrifice and Stigma – single group

Agent-based extension - macroscopic level, winners and losers

Dynamic, interactive, rules-based agents operating in a spatial and temporal world

Max(U)

MARS – S&SAgents color- and shape-coded by group

Groups identifiable along a sacrifice spectrum from 0 to 100 % of secular productivity loss

Lognormal Income Distribution

01

23

45

Lo

g G

rou

p M

em

be

rsBeta = 0.7

0.5

1S

acr

fice

%

0 20 40 60Group ID#

Group Membership relative to Sacrifice Scale

Extremism as a Percent of the Population

0.5

10

.51

10 20 30 40 50 60 10 20 30 40 50 60 10 20 30 40 50 60

0.4 0.5 0.6

0.7 0.8 0.9

extremistPerc2 Median bands

Gro

up S

ize

as P

erce

nt o

f Pop

ulat

ion

Beta

Extremist Group Size as Percent Over BetaGraphed by Mean Income

0.5

10

.51

0.5

1

.4 .5 .6 .7 .8 .9

.4 .5 .6 .7 .8 .9 .4 .5 .6 .7 .8 .9

8 16 24

32 40 48

56 64

extremistPerc2 Median bandsG

roup

Siz

e as

Per

cent

of P

opul

atio

n

Beta

Extremist Group Size as Percent Over BetaGraphed by Mean Income

Income Substitutability

Empirical Connections – Krueger and Maleckova 20031. Terrorists from a country are decreasing in

number as that nation’s civil liberties, as measured by Freedom House Civil Liberties Index, are increasing.

2. When Civil Liberties are controlled for, the relative wealth of the country and its illiteracy rate have no statistically significant effect.

Regression Analysis of the ModelQuantile Regression Estimates: Fraction Log Full Income Dedicated to Club Production

Quantile

10% 25% 50% 75% 90%

Log Full Income -0.250 -0.828 -0.817 -0.961 -0.519

(0.000) (0.007)

(0.004)

(0.007)

(0.003)

Log Substitutability (β)

-8.478

-5.940

-3.539

0.184 1.928

(0.002) (0.040)

(0.017)

(0.032)

(0.013)

Constant -9.12 -4.959 -2.543 1.173 1.519

(0.001) (0.022)

(0.014)

(0.032)

(0.014)

N 52272 52272 52272 52272 52272

Standard errors in parentheses, all coefficients significant at 0.1% level

ISSP 1998 +Bootstrap Quantile Regression Religion - Work Ratio

30% 40% 50% 60% 70% 80% 90%

Civil Liberties

-6.618(1.048)

**

-0.448(0.892)

6.071(1.233)

**

11.096(0.814)

**

12.701(1.490)

**

5.660(1.243)

**

2.290(0.623)

**

Economic Freedom

-2.450(0.331)

**

-0.375(0.576)

-0.266(0.433)

0.269(0.433)

0.210(1.181)

-3.337(0.641)

**

0.376(0.335)

Earnings -0.000(0.000)

-0.000(0.000)

-0.338(0.068)

**

-0.342(0.064)

**

-0.348(0.048)

**

-0.238(0.041)

**

-0.318(0.034)

**

Religious Regulation

1.994(0.205)

**

0.239(0.446)

-1.092(0.329)

**

-1.554(0.240)

**

-2.460(0.694)

**

-0.824(0.309)

**

-1.025(0.210)

**

State Religion

-1.092(0.318)

**

0.681(0.100)

**

1.712(0.336)

**

2.475(0.164)

**

2.641(0.223)

**

1.119(0.260)

**

0.332(0.153)

*

Muslim -1.486(0.231)

**

-0.104(0.182)

1.035(0.248)

**

1.640(0.140)

**

2.076(0.338)

**

0.921(0.210)

**

0.450(0.140)

**

Constant 15.677(3.762)

**

-7.041(2.764)

*

-19.814(4.092)

**

-29.100(2.630)

**

-34.246(5.667)

**

-13.362(3.208)

**

-6.557(2.344)

**

N 5106 5106 5106 5106 5106 5106 5106

Testing Suggested Policy 1

(1 )) { 0}1

j i SQ R s An

02

46

02

46

02

46

02

46

02

46

1

2

3

4

5

Lo

g G

rou

p M

em

be

rs

Group ID #, in ascending order of required sacrifice

Group Size Distribution by Public Good QuantityMean Income = 8, Beta = 0.8

Policy Test (continued)

A public good competitive with the club good reduces the appeal of extremism

The popular shift is towards the strict groups, and not the most liberal (secularists)

BUT there is no impact on the sacrifice profile of a population unless the public good is subject to group sacrifice requirements This is potentially a good thing – sacrifice of the

public good is most likely to be realized by groups operating outside the law.

Conclusions

Substitutability is necessary and quasi-sufficient for Extremist groups to be sustainable. Population Income matters, but is dominated by Subsitutability.

Extremist groups have incentive to package themselves as strong substitutes for privately productive activities This correlates to Hamas and Hezbollah dedicating the

bulk of their resources to social services Public Goods competitive with the club good are a

potentially viable mechanism for reducing the appeal of extremism

The Rest are just Appendices

The End

Experiment Parameterization

1

( )i S i K iU b S b K

1(1 ))

1j iQ R s

n

1( )iK R Q

1( )a aS S SS A x t

1( )b bR R RR A x t

1(prices of good)pS, pR

60(number of Groups)G

0.3b

0.7a

0.3α

1.25s

1bs, bk

ValueRelated FunctionParameter

Test Variables – Beta and Mean Income Fixed Parameters

Nash starting condition

iterated pure strategy interaction between an agent i and a generic neighbor j.

is assumed to be common knowledge, as is the rationality of both players. Player turns are executed sequentially (as opposed to simultaneously) with t incrementing by one when an agent makes a calculation. The starting value is a parameter value assigned to

avoid indefinite solutions.

Rj

Ri

Ri=Rj

1( )ti jR f R

1tpR